Case Study Tanzania

National level: Tanzania has considerable land resources for liquid biofuels production which could be used for export earnings as well as to reduce fossil oil imports, to increase employment, and to stimulate rural economic growth. In recent years, there has been a growing interest in liquid biofuels. Local and multinational investors are acquiring increasingly large farms, some in the range of up to 400,000 hectares in some parts of Tanzania. But also some smallholder farmers have developed interest in taking advantage of this opportunity through improving rural energy services, soap production and selling seeds and oil to large companies. Jatropha is being considered as one of the main crops for producing biofuels (biodiesel or straight vegetable oil - SVO) in Tanzania.

The growing interest in liquid biofuels production has also increased government commitment to the promotion of the biofuel sector. However, while the biofuels sector is growing, the country is facing several socio-economic challenges without a clear bioenergy policy. There are only statements within energy, agriculture, forest, land and environment policies aimed at enhancing production and use of solid biofuels. Liquid biofuel guidelines have recently been approved by the parliament. However, recent development in biofuel production in the country has led to calls on government to develop a comprehensive policy and strategies for biofuels development.

Regional level: The first Case Study in Tanzania assesses the Sun-Biofuels company located in Kisarawe District, Coastal Region. The company is representing a stand-alone large scale plantation model. Sun-Biofuels (Tanzania) Ltd has invested in an 8,200 ha plant with a strategy to cover the whole biofuel value chain, from feedstock cultivation to processing and marketing of the end product. The company has directly and indirectly affected over 10,000 inhabitants in 12 villages from which the land was allocated for jatropha plantations.

The second Case Study is the company Diligent in the Arusha region. It is representing a contractor business model for jatropha in which smallholder farmers are producing jatropha seeds on contractual arrangements with Diligent. The company has entered into contracts with local smallholder farmers, who grow jatropha and contractually supply seeds to the company. The company has no own plantation-based production, but it sources seeds solely from contracted local farmers and out-growers. The company is producing oil for domestic use and export. The by–products are used locally.

Local level: At local level the independent small-scale farmer model plays an important role of producing, processing and marketing jatropha. Some small-scale farmers are organised in associations/cooperatives in order to locally produce, process and use jatropha oil and its by-products for meeting their different own needs.

The Case Study of independent smallholder communities for local level focuses on Leguruki and Selela Village Communities in Arusha Region. Jatropha is produced from small farms by intercropping with other crops or planting on their farm hedges. Jatropha oil and other by products are either used locally or sold to local processing centres (Energy Services Platform - ESPs) for rural electrification and motive power for milling, de-husking and oil pressing. Villagers bring their seeds for pressing to the ESPs in order to produce jatropha oil. Electricity is distributed to the villagers from ESPs through mini-grids constructed in the two villages. Villagers have been using electricity as an alternative energy source for the provision of light, powering various electrical appliances such as radio, TV sets, charging mobile phones and other services. The installed ESPs create income for village government through collection of taxes from entrepreneurs who own ESPs and individuals through selling jatropha oil and other by-products. Moreover, jatropha oil is used for soap making, insect repellents and seedcakes for biogas plants.

The model of independent small-scale farmers in cooperatives has been observed to be a potential promising business model for developing jatropha farming in Tanzania. This model has high positive socio-economic and environmental impacts since it enables people to produce, to process and to use jatropha oil locally for income and energy generation and has potential to sell extra oil or seeds to local biodiesel producing companies.

The following Global-Bio-Pact report has been published:

SAWE E.M., SHUMA J., PESAMBILI L.C. (2011)
Global-Bio-Pact Case Study: Socio-Economic Impacts of Jatropha Chains in Tanzania
TATEDo; Report of the FP7 Global-Bio-Pact Project (FP7-245085) [download]